On June 4, the CFPB released a study on reverse mortgage advertisements. The Bureau seems particularly focused on this product because it is popular among older Americans, whom it characterizes as more “vulnerable.” Not surprisingly, the Bureau concluded that the advertisements can be misleading and create consumer risks: “…advertisements frequently do not describe all the details of the particular product or service being sold, [and] the incompleteness of reverse mortgage ads raises heightened concerns because reverse mortgages are complicated and often expensive loans intended for older, and frequently vulnerable, homeowners.” In particular, the study highlights “difficult-to-read” fine print, “ambiguity” in the nature of reverse mortgages, the use of “celebrity endorsements” (although it’s unclear why that’s such a bad thing), and false impressions of government affiliation and/or financial security.
Here are the Bureau’s various publications on the topic this week:
- Press Release: CFPB Study Finds Reverse Mortgage Advertisements Can Create False Impressions
- Study: A closer look at reverse mortgage advertisements and consumer risks
- Consumer Advisory: Don’t be misled by reverse mortgage advertising
- Director Cordray’s Remarks: Prepared Remarks of CFPB Director Richard Cordray on the Reverse Mortgage Advertising Press Call